The Miami Herald, Inc.; Monday, March 24, 1997
Amy Ellerson; Herald Writer

The friend, diagnosed with AIDS, was broke and forced to decide whether to pay rent, buy groceries or honor his doctor's bills. While reviewing the friend's finances, Page saw that he was making monthly payments on a $100,000 life insurance policy.

So he arranged for an $80,000 loan using the policy as collateral.

"It worked and changed this guy completely," said Page, 33, a native of Baltimore. "Now that he had money, he felt he could live life with meaning. He didn't feel like a burden on his family and friends anymore."

In 1989, Page created a company in Cleveland to do essentially what he did for his friend. Called Page & Associates, the viatical settlement company, now based in Fort Lauderdale, processes about 100 applications a month with policies averaging $150,000.

Viatical settlement is the term used to describe a transaction in which an investor buys a dying patient's life insurance policy at less than face value, thereby allowing the policyholder to spend the money before death.

The investor typically gets anywhere from 50 to 80 percent of the policy's face value, depending on the life expectancy. Once the patient dies, the investor cashes in the policy and pays Page for administrative costs, usually 15 to 20 percent.

The risk to the investor is that the patient will live longer than expected. Page said it's his company's policy to thoroughly review a patient's medical history to reduce that risk. Last year, the Legislature required viatical settlement companies to be licensed. Eleven, including Page & Associates, have applied for a license, said an Insurance Department spokesman, Dan McClaughlin.

The department first became aware of viatical settlement sales about eight years ago in South Florida, he said, before drug therapies prolonged the life expectancy of people with HIV. The department has received few consumer complaints, he said, and has seen little growth in the industry.

With 14 employees, Page and Associates collected $2.8 million in revenues last year. About 80 percent of its clients have HIV or AIDS, and many are in dire straits, Page said.

"The large percentage of our clients, when they come to us, are on the verge of becoming destitute. They're about to be evicted, they're a burden on their families and they can't buy medicine," he said. "We're able to give them a new lease on life."

Page, who is also president of the National Viatical Association, ran a program for soldiers with HIV and AIDS at the Air Force base in Myrtle Beach, S.C., a post he volunteered for. "I raised my hand, and it changed my life forever," he said.

He moved his company to South Florida in 1994 because of its high concentration of HIV and AIDS cases.

Terminally ill clients have been easier to find than investors, many of whom are cautious about investing in something unfamiliar, he said.

"It's new and it's different, and when I tell people about it, they usually want to know where the hitch is," he said. "But there isn't any."

BOB EIGHMIE / Herald Staff flabiz

UNUSUAL PROGRAM: Scott Page finds investors who buy patients' life insurance policies.

CAPTION: photo: Scott Page

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